I'm a staff writer at Forbes, where until recently I chased the super-rich for our Forbes 400 and World's Billionaires lists. Now I'm covering the consumer economy, writing about the big personalities reinventing retail. Before Forbes, I worked as a news reporter in the UK and my home country of Bermuda, a travel writer for Frommer's and an intern for CNN's Anderson Cooper while completing a master's degree at Columbia University. Got a story idea? Email me at coconnor@forbes.com.

Fourth Time's A Charm: How Donald Trump Made Bankruptcy Work For Him

Here at FORBES, we’ve been tracking Donald Trump‘s wealth since the inaugural Forbes 400 rich list in 1982. Today, we value him at $2.7 billion, although he claims he’s worth far more. One question we’re often asked when talk turns to Trump’s fortune: how can a man who has been bankrupt so many times remain a multi-billionaire? How is he worth more now, post-bankruptcies? We spoke to bankruptcy lawyers and casino industry experts — some of whom have had firsthand involvement in Chapter 11 cases connected to Trump — in an attempt to explain how he has survived corporate bankruptcies and thrived in the aftermath.

1. It’s nothing personal…

First things first: Donald Trump has filed for corporate bankruptcy four times, in 1991, 1992, 2004 and 2009. All of these bankruptcies were connected to over-leveraged casino and hotel properties in Atlantic City, all of which are now operated under the banner of Trump Entertainment Resorts. He has never filed for personal bankruptcy — an important distinction when considering his ability to emerge relatively unscathed, at least financially.

“Corporations, limited partnerships, and LLCs in which he had an ownership interest or companies that had his name attached have filed for bankruptcy,” said Michael Viscount of Atlantic City law firm FoxFox Rothschild LLP, who represented unsecured creditors when Trump Hotels & Casino Resorts, as it was then called, filed for Chapter 11 protection in 2004. “Therein lies the big distinction.”

He did take a personal hit the first time around: he’d financed the construction of the Trump Taj Mahal with junk bonds and was unable to pay the high interest. His business was in the red, and so was he, to the tune of about $900 million in personal debt. By the mid-90s, he’d reduced most of that debt, selling his Trump Princess yacht, his Trump Shuttle airline, and his stake in a handful of other businesses. More importantly, he stopped guaranteeing debt with his own wealth. “The first bankruptcy was the only time his personal fortune was at stake,” said Ted Connolly, a Boston bankruptcy lawyer who used Trump as model for getting out of debt in his book The Road Out Of Debt: Bankruptcy and Other Solutions to Your Financial Problems. “He learned from it. He’s insulated.”

2. …it’s just business.

Trump has never apologized for using Chapter 11 as a business tool — indeed, when he spoke to my FORBES colleague Keren Blankfeld recently, he noted that many “great entrepreneurs” have used bankruptcy to restructure debt, free up capital and improve their businesses.

“I’ve cut debt — by the way, this isn’t me personally, it’s a company,” Trump said. “Basically I’ve used the laws of the country to my advantage and to other people’s advantage just as Leon Black has, Carl Icahn, Henry Kravis has, just as many, many others on top of the business world have.”

But to those uninitiated in bankruptcy laws, four instances of corporate bankruptcy in a row can seem staggering. “To the ordinary person in the street, it may seem surprising, but certainly not to me,” said Reed Smith partner Michael Venditto, who has represented clients in high profile Chapter 11 cases, including bankrupt airline TWA. “Chapter 11 is how you reshape and restructure a company that has problems. It doesn’t indicate anything nefarious or even bad management.”

3. It’s better than the alternative.

More important, said Venditto, are the repercussions Chapter 11 might have for creditors versus, say, liquidation. “You can have a visceral reaction to the fact that this company has gone through Chapter 11 multiple times, but the bondholders look at it and the alternatives are much, much worse. What is an empty casino sitting on the Atlantic City boardwalk worth? If it’s operating and it’s got cash flow and income, it may not be able to pay back every cent on the dollar, but the creditors are better off in the long run.”

4. He’s leveraged his persona.

Trump’s name and image have undoubtedly helped him survive each bankruptcy and come out on top. He’s able to demand a high percentage of reorganization equity based on the value his brand brings to a casino or hotel operation. So says Edward Weisfelner, a partner at New York firm Brown Rudnick who was involved in two of the three casino bankruptcies, first representing bondholders, then as counsel to Carl Icahn’s firm Icahn Partners, who tried to buy most of the debt in Trump Entertainment Resorts. “The leverage he had was that his name was on the side of his casinos,” said Weisfelner. “The cost of throwing him out, rebranding and changing his name everywhere would be very high. ”

Added Joseph Weinert, senior vice president at Atlantic City casino consultancy Spectrum Gaming Group, who has produced research for Trump: “ The stakeholders decided they were better off with Trump’s name than they were without it.”

5. He has less and less interest in the bankrupt companies.

With each bankruptcy proceeding, Donald Trump’s stake in the casinos and hotels in Atlantic city that bear his name has decreased. In the first Trump Taj Mahal bankruptcy, he handed over 50% equity to bondholders in return for favorable interest rates. In 2004′s Chapter 11 filing, his stake was reduced to 25%. During wranglings with bondholders immediately before the 2009 bankruptcy, Trump resigned from the board of Trump Entertainment Resorts; his equity stake is now 5%, with another 5% in warrants.

6. He’s not the one to blame.

Atlantic City lawyer Viscount doesn’t believe Donald Trump himself should be held accountable for any of his company’s bankruptcies — his creditors, he said, knew what they were getting themselves into when they lent Trump money over and over again. “They’re all big boys and girls,” he said. “They’ve all played this game before, in the insolvency space. The company that possessed his name filed bankruptcy because it was overleveraged. What does that tell you? People want to lend him money. He does grandiose things with it.”

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A lot of people who don’t understand the differences between Chapter 7, 11, (12) and 13 also don’t understand how so many wealthy people have kept their fortunes after bankruptcy. Great article spelling it out with examples.

Trump understands business, and ultimately a Chapter 11 is a business decision. You have to think of the investors and do what is best for them when you own a business – if that means bankruptcy/reorganization is the best option then so be it.

Just because he has done well for himself doesn’t mean he should have to sign his personal name for every company he owns. That’s why there are investors and creditors.

Our company is one of the small businesses affected by Trump’s last bankruptcy. Anyone who thinks “He’s done nothing inappropriate” is terribly wrong. No one thinks about the small businesses he’s hurt. Now he wants to run the country and fix the economic problems that he helped create. He is part of the problem not the solution!!

In one of my first business courses, I was taught to incorporate because corporations allow the owners to benefit fully from luck choices, while limiting their liability for bad luck. How many people out their got rich running corporations, and got to keep their riches when their luck ran out, even if they took a solid company and ran it into the ground by taking huge risks?

Now think of Donald Trump and all the other millionaire presidential candidates who got rich running corporations into bankruptcy. Aren’t you glad their not running the country into bankruptcy while making themselves richer?

In one of my first business courses, I was taught to incorporate because corporations allow the owners to benefit fully from lucky choices, while limiting their liability for bad luck. How many people got rich running corporations, and got to keep their riches when their luck ran out, even if they took a solid company and ran it into banruptcy by taking huge risks?

Now think of Donald Trump and all the other millionaire presidential candidates who got rich running corporations into bankruptcy. Aren’t you glad they are not running the country into bankruptcy while making themselves richer?

Having just watched the documentary ‘You’ve been Trumped’, about Donald pushing through his Scottish golf course against a local opposition, I went to his Scottish website. There, as expected was the golf course and hotel, except on further research, there is no hotel, nor any of the other promised development. Apparently he has a problem with a wind farm, which may appear offshore, or so the story goes.

Now don’t get me wrong, if I were one of the crofters, I’d have struck an outrageously good deal with Mr Trump and thanked my lucky stars, but having said that I do sympathise with incumbents. After-all there is no place like home and this is not a motorway, reservoir or high speed rail track. What it is, is just just another golf course, of which there are many struggling to make ends meet. So what is this investment really all about?

Whether Mr Trump ever intended to develop the site himself is more to the point. He sensibly doesn’t actually own many of the hotels that bear his name, he merely licenses his name to add prestige to anonymous buildings.

Developing Nowhere USA usually starts with a golf course, which is the modern equivalent of the railroad. It supposedly makes nowhere, somewhere. Nobody’s actually interested in the golf, the course is just a hub for development. Typically, in Las Vegas for example, the next step is to surround the lush course with McMansions and then develop out, with every ripple aiming at a cheaper market.

What Donald has achieved in Scotland is the golf course hub and planning permission for the development. He no longer needs to develop the rest himself, others can take that risk and have the benefit of his name over the door.

However the reality is what we now have is a golf course without the promised luxury hotel. The excuse is the wind farm but what is the reality? Could Mr Trump’s empire be going down for a fifth time? Or, having turned a natural wasteland into a cultural wasteland with holes for the intellectually challenged, is Donald really biding his time, looking around for others to do the big investment so he can sell them the plots and just license his name?

Yeah this is where you get well compensated with salary and bonuses even though the business is going under. Once you have pretty much drained the company, you file bankruptcy. During this entire time these folks know that the income is not coming in needed to run the business, but their personal pockets are getting bigger. This is where us regular folks could do the same thing because there are limitations on what the creditors can touch. After 3 years your credit is good enough to start borrowing. If I could live with myself I could set myself up in a better situation every time I filed bankruptcy.

There is much more to this public announcement than meets the eye. Most people are unaware of the true dealings that comprise the foundation of this bankruptcy.

Atlantic City is currently being tyrannized by corporate greed and covert deals spearheaded by Caesars, Carl Icahn and Governor Christie, who plan to promote a ballot referendum to move casinos to other parts of NJ.

Atlantic City’s current Casino industry is about $3 Billion yearly and when taking into account the very small size of the city and the surrounding rural area it stands as the only economic engine to the entire region.

While Mr. Christie and his allies have been recently forging public sentiment by touting Atlantic City’s failures and NJ’s failing public pension system, he has overseen over $2 Billion in public pension funds to Caesars parent Company (1.7B 2013) and Revel’s hedge fund group ($300 Million in July of this year). Revel is the brand new and recently closed (Sept 2nd) $2.5 Billion property sitting adjacent to Trump Taj Mahal on the Boardwalk.

In case you might still be inclined to believe that Atlantic City is failing, we find that perhaps it is deliberately failing in an attempt to promote the move to other parts of the state where, according to an August 18 article in the NY Times, “…the most successful casino in the world…” WILL be built. This would severely impact the Atlantic City market and yet a ballot referendum has not been approved.

In fact, these covert plans and the farce created have caused irreparable economic downturns in the rural area as nearly 40% of the workforce has been laid off since January – and that doesn’t account for the nearly 3,000 who will be laid off if the Trump Taj Mahal closes.

Deed restrictions by Caesars on its properties are preventing independent operators from purchasing and/or operating a casino here. It appears now that Carl Icahn is joining the ranks of those manipulating the casino market here.

It seems apparent that efforts to turn Atlantic City into a seasonal marketplace are underway and that the industry will be governed by Caesars and Carl Icahn, which takes us back to the subject of the current bankruptcy.

The truth is that Mr. Griffin and his henchmen were major shareholders of Trump stock before the bankruptcy in 2009. They lost millions and, after hearings and limited press coverage of the newly structured deal, were granted the ownership of the property in a sale over Carl Icahn, who held the debt.

Mr. Icahn structured the nearly $300 Million sale with a balloon mortgage that required only interest payments of about $38 Million yearly until the balloon expires at the end of next year.

Carl Icahn still holds the debt and is also the owner of the Tropicana Hotel Casino in Atlantic City’s famed Boardwalk district. He owns the debt on the Trump Plaza, which is scheduled to close on September 16th. Ironically, he denied an offer by Muruelo Group to purchase the Plaza in 2013, claiming the buying price of $25 million was too low even though the buyers were going to spend $100 Million on renovations and upgrades to the property.

The Taj Mahal generates more than $250 Million yearly in total gross revenues and reported operating profits of $19.2 Million for the first half of 2014, which is based on gaming revenue only.

How can a company that had an operating profit of $19.2 million dollars for the first half of the year file for bankruptcy? The reported earnings were based on gaming revenue of $109 Million and doesn’t include revenue from non-gaming sources. That equates to a profit margin of 17.6%!

According to NJ Online Casino, gaming revenue is, on average, 50% MORE than non-gaming revenue, which means there is another $75 Million of revenue with which to apply the same profit margin. $75M x 17.6% = $13.2 Million. Add that to the $19.2 Million for gaming revenue and we get a $32.4 Million profit for the first half of 2014.

Here is where it really gets interesting. According to many reliable sources, including the one mentioned above, gross revenues for the second half of the year are twice as much as the first half! If we do the math correctly, we see a profit of $97.2 Million for the entire year!

If we look at the company’s reduction in amenities, customer service and property maintenance, we find that, perhaps, a lot of this money is unaccounted for. We are being SOLD on a bankruptcy that stands to destroy what so many of us have worked for our entire adult-lives.

Is it possible that Mr. Griffin and other major shareholders of Trump stock in 2009, PURCHASED the Taj with the SOLE intent of stealing their money back, which meant running it into the ground before the balloon mortgage expired? Was this a preconceived agenda? Why can’t Griffin get another mortgage?

I want to know who holds these companies ACCOUNTABLE for their actions. Now we can see why Christie spearheaded the recent deregulation of the Casino Control Commission, which would prevent bankruptcy without heavy scrutiny!

What a shame that fascism can hide beneath the guise of insolvency! Welcome to the Atlantic City shell game.